Term insurance has benefitted millions of life insurance buyers and their families to be financially independent and live a dignified life even in the absence of the earning member of the family. It is an excellent tool to ensure financial security for your family at an affordable price.
However, one of the most common problems that most term insurance buyers face is whether single term insurance is enough to meet the family’s financial requirements or do they need to buy multiple term insurance plans.
If you too are facing this dilemma, let us tell you, you can buy as many term insurance plans as you want. There are no restrictions. Read on to know more about buying multiple term insurance policies.
When is it advisable to have more than one term life insurance policy?
If you have purchased multiple term life insurance policies, it can be helpful in the following situations.
- The insurance company rejects your claim request
Sometimes when the nominee request for term insurance, the insurer may reject the request on several grounds. Some popular reasons for rejection include non-disclosure of important information in the insurance application, incomplete paperwork, inaccurate information, not providing nominee details, non-payment of premium, etc.
In such a situation, having multiple term plans can help your loved ones get additional financial protection. Even if one insurance company refuses to pay the death benefit, they may get financial aid from another one.
- Your term policy does not allow increasing the coverage amount
Most people buy term insurance when they are young to take advantage of the low premium. However, as they grow older, get married, and have kids eventually, their insurance needs may change. They may feel the need to increase the coverage amount to cover the financial needs of the dependents. However, if the existing term insurance provider does not allow increasing coverage, buying a new policy with a higher coverage amount will be a better option.
- You want better benefits
Not all term insurance policies have the same features and offer the same benefits. For example, some plans do not allow you to purchase additional riders. In such a situation, it is better to buy more than one policy so that you can customise your policy, buy additional riders to suit your needs and get better benefits.
Benefits of having more than one term insurance policy
- Additional financial security
One of the most obvious benefits of buying multiple term insurance policies is that it provides additional financial security to your family. Having more than policy means your family will get death benefit from each policy, and they will have extra money to take care of their everyday financial needs. Even if one of the insurance companies rejects your family member’s claim request, they will have a backup option.
- More money
Having more than one term insurance means your family will receive more money in the event of your demise. This may help them make up for the permanent loss of income. Your family can use the money to pay off the dues and loans (if any), pay for the child’s education/marriage or even start a new business and create a steady income source for themselves.
With additional money received from multiple policies, they can live a comfortable life and be financially independent.
- Peace of mind
By purchasing more than one term life insurance policy, you can be relaxed and have peace of mind knowing that your family is sufficiently protected against future uncertainties. You can rest assured that your loved ones will never have to face any financial difficulties, even in your absence.
Should you buy more than one life insurance policy?
A term insurance policy secures your family members financially. But it comes with a cost. Hence before buying multiple term policies, it is advisable that you assess the associated expenses.
Living a frugal life in the present to save your loved one’s future may leave you frustrated and anxious. So, it is better to choose multiple term plans only if you can afford them. Or you can purchase a single term plan with a high sum assured up to Rs. 1 crore.
There are several plans in the market; make sure you compare the different plans online and choose the one that perfectly suits your needs.
